Monetary Policy

Complementary Lending Facility

A means by which the Bank extends loans to its counterparties upon request. Loans are limited by the counterparties' amount outstanding of pooled collateral that has been submitted. These loans are basically subject to the basic loan rate and are repayable on the following business day.

Note: The basic rule is that the maximum number of days on which counterparties can use the facility at the basic loan rate is five business days per reserve maintenance period. In principle, counterparties that wish to use the facility beyond this maximum number of days must pay a higher rate of 2 percent plus the basic loan rate. However, the restriction on the maximum number of days has been suspended since March 2003, and the basic loan rate has been applied regardless of the number of days used.

Note: The English translation has been prepared by the Bank's staff based on the Japanese original and is an unofficial translation. The translation is to be used solely as reference material to aid in the understanding of Japanese original.